Abbreviations I use in the post: PDH: Previous day’s high, PDL: Previous day’s low, IB: Initial Balance or First 1 hour range, NVD: Normal variation day (one of the market profile day types), OTD: open test drive, POC: Point of control, HVN (High volume node)
Observation from previous day:
On Thursday, Nifty opened inside previous day’s range and sellers tried to push prices below PDL in start but there was some buying below PDL which prevented the fall. Also this buying was not strong enough to push prices above IB high and NIfty for the entire day consolidated near PDL and this sideways move can also be attributed to weekly expiry. Now as we talked before, it seems higher timeframe are not interested in directional move and that is why we are drifting down slowly due to absence of good buying pressure. But, Nifty is at important level now considering higher timeframe and make or break of this level can change the equation, so it becomes crucial to observe if we are accepting or rejecting prices below PDL.
What can be expected now:
As said, nifty is now at important support, so we need to see if prices accept below PDL or gets rejected. Acceptance below PDL is not good for buyers and rejection below PDL or acceptance above PDL is not good for sellers.
PDH (15774) and PDL (15699) are important levels from previous day’s range. Acceptance above PDH can take nifty to test Virgin POC at 15855 and acceptance below PDL can can test virgin POC at 15600.
Trade plan for today:
Nifty is expected to open inside previous day’s range near PDL and there is no clarity at open auction. I am bullish if prices accept above PDL and bearish if prices accept below PDL, But instead of taking immediate trade, I will wait for clear signs of acceptance as there can be a likely rejection below PDL, as we are near important support.
- Short trades are risky if prices trade above PDL.
- Long trades are risky if prices trade below PDL.
- Banknifty is in sync with nifty, so we can take additional confirmation from it.
Please note that this is a personal view for learning , observational and education purpose and is not a trading recommendation. Trading futures carry a risk, so you should consult a financial expert before taking any risk. Also, Nifty in above statements Indicate Nifty future for current month and not Nifty index.